Besides individuals, a company can also have an account statement with another company. Such cases occur when a company makes deposits with another and gradually withdraws in terms of purchases. The summary of such transactions will qualify as an account statement.
How does an account statement work?
Given that it is a summary of transactions, there is an associated period. So, you have a start date and an end date. Based on this, when requesting an account statement, you are mostly always requesting the period.
What you will find on an account statement
1. Statement period: The specific period of time, such as a month, quarter, or year.
2. Account activity: All the transactions that have occurred in the account, such as deposits, withdrawals, purchases, and fees.
3. Beginning and ending balances: The beginning balance is the balance in the account at the start of the period, while the ending balance is the balance in the account at the end of the period.
4. Interest and fees: The statement may include information about interest earned or fees charged.
5. Additional information: Other information related to the account, such as account numbers, contact information, and terms and conditions.
Uses of an account statement
- Provides an overview of account activity
- Transparency of transactions
- Identifies errors or discrepancies
- Budgeting and planning
- Test for creditworthiness for loan or visa applications
- Helps reconcile account balances
- Provides documentation for tax purposes
Overall, an account statement provides a snapshot of account activity and balances over a specific period of time and can be used as a tool for monitoring and managing financial accounts.
Learn more about finance
No matter your level of financial literacy, we have more than enough financial education resources to get you started. Also, with our wealth management app, you can easily save, invest, and begin your own path to financial independence.